The European Central Bank, also known as ECB, recently unveiled a European service that will facilitate instantaneous electronic payments. This is an exciting, albeit necessary step for e-commerce, as consumers are often shopping online and making payments outside standard business hours. Coupled with the rise of mobile payment services, consumers now expect payments to take place instantly, rather than waiting days.
TIPS (TARGET Instant Payment Settlement) uses central bank money to settle individual payments in under 10 seconds. Surprisingly, TIPS is also very reasonably priced and has no entry or maintenance fees for account holders. For the first two years of operation, the price per initiated transaction is set at €0.002. There are also no charges for the first ten million payments settled on each TIPS account by the end of 2019.
The first instant transaction involved a client of the Spanish bank, CaixaBank, who used TIPS to make an instant payment to a client of the French bank, Natixis. Natixis garners 20% of the market share in France for electronic payments, so being part of the first instantaneous electronic payment has cemented their reputation as a major player in the payment field.
Enabling mainframe systems for real-time instant payments is difficult because legacy systems were not designed to call APIs or be called. Natixis was able to successfully accept the first instant payment due to their use of our mainframe integration solution, Ivory Suite. Ivory facilitated the quick creation of complex API’s to easily enable Natixis to connect their mainframe to applications that allow the transfer of money in real-time. Moreover, it did all this without the use of coding. Learn how Ivory can help your company become a leader in innovation.
-Amanda Bierfeld, Marketing Coordinator at GT Software